What is a Post Marital Agreement?
An agreement that is entered into after you are already married is called a post marital agreement. Similar agreements entered into prior to marriage are referred to as prenuptial agreements. A post martial agreement must be in writing, signed by both parties, and either acknowledged before an officer authorized to administer oaths or notarized.
Post martial agreements can offer the same protections to you as an agreement entered into prior to marriage . For example, assuming the proper disclosure is made prior to the agreement being entered, a post marital agreement can set aside property for an individual spouse, acknowledge premarital separate property, determine the division of joint property in the event of a divorce or death, address spousal maintenance, address attorney’s fees, and resolve any other issue that the couple wishes to address prior to entering into the agreement.
Essential Features of a Post Marital Agreement Template
The fundamental purpose of a post marital agreement template is to provide a source of guidance for the pressing financial issues that could face a couple that is now married. Given their mutual devotion to one another, every couple will encounter these difficulties at some point in the relationship – and compiling this preemptive document can help manage these scenarios when they arise. Some common areas of focus for post marital agreements include:
Management of Assets. As requested, a post marital agreement should detail how this couple will handle their assets. For example, there is a strong chance that one couple will have made substantially more money prior to the marriage, and the agreement can outline how his or her assets will be shared – if at all. Despite the fact that "his" and "her" assets are not typically legally shared, many couples will agree to split any assets gifted to them once they are married.
Debt Management. While they work hand-in-hand with assets, debts are a separate issue worthy of exploration. If one partner has taken on a substantial debt, such as student loans or housing expenses, he or she will want to know that these will not be passed on to the other partner during the marriage. It may also be necessary to lay out how this couple will address debt accumulated during the marriage.
Spousal Support. Although it’s not the ideal conversation topic for post marital agreements, this section can be managed simply by addressing how finances and assets will be handled during the marriage, rather than focusing on the potential divorce.
Of course, all post marital agreement templates are customized to the relationship. The major concern is that these documents should be put into place right away, before the debate over asset division and debt management begins.
Legal Advantages of a Post Marital Agreement
The legal advantages of a post marital agreement are significant. Perhaps the most salient is the fortification such a contract provides against claims to community property brought by one spouse against the other. In California, it is presumed that all property acquired during marriage is community property by the married couple. Once a claim to this property is filed in court or action to get property during marriage, the burden falls on the spouse that made the acquisition to prove the property was separate and not community in nature. When a post marital agreement has been executed, these separate characterizations and burdens are enhanced. Separate property can either be real estate or anything other than real estate. In the case of real estate, if the property is separate when you enter marriage, its value at the end of the marriage is separate. However, if it is acquired during marriage, then its entire value at end of marriage is community property, unless (1) the down payment is from separate assets (assets to which one spouse or the other spouse acquired before marriage) or (2) the property is specifically for the sole benefit of one spouse. If the house was purchased in joint form, as husband and wife, to contest community property rights in the house, they must show the down payment was from separate property and sometimes that the loan was also secured with separate assets. If it is not (for instance there may have been no down payment), then the entire value of the property at the end of the marriage is is clearly community property. Separate property is anything that was acquired outside of marriage. This means (1) property acquired by gift or inheritance (cash gift to spouse that was not community property) or (2) property acquired as a result of the depreciation of a separate asset during marriage (a home that was inherited prior to marriage that depreciated during marriage). If there is a claim to community property, however, having a post marital agreement often makes sure that property during marriage was separate property. When property that is acquired during marriage is acquired with both spouse’s efforts, then the property is presumed community. Thus, there are provisions in the family code that allow spouses to receive reimbursement when a separate asset is used to acquire community property due to the efforts of the other spouse to maintain it.
How to Draft a Tailored Post Marital Agreement
A crucial aspect of creating a tailored post marital agreement is to first seek guidance from a licensed legal professional who has experience in preparing such documents. They will direct you toward relevant resources and steer you away from potential pitfalls. For example, a prenuptial agreement you created for a previous marriage is sufficient if the same set of assets still exists. However, if you have more or less wealth with your new spouse, then you ex-spouse. Clearly, this template must be modified to ensure that it is sufficiently protective yet not overly protective. It also must not violate any state laws.
Your licensed attorney also guides you toward disclosure – something that is instrumental to a successful post marital agreement. This step means revealing all assets to one another so that the distribution process can be fair and equitable. After all , if one spouse does not disclose certain assets, then the agreement would not be valid in a court of law. Thus, full disclosure to each other is imperative because if you lie about something, then the whole thing can be thrown out in court. Your attorney will also provide you with a list of what information you must exchange including:
As an example, let’s say that you have a 401(k) retirement account and a pension. If you want half of that (50%) should you divorce, then the agreement must be prepared in a manner that enables you to receive that equitable share. However, the court would eventually have to validate that agreement. Thus, your attorney will provide you with a list of what information you need to ask the other spouse for or research yourself.
Pitfalls to Avoid
A common mistake I see with clients is that they might use boilerplate language found on the internet or in a book even when my office is drafting an agreement. While it is certainly possible for them to draft an agreement themselves using these resources, I strongly advise against it. I do so in order to avoid possible ambiguity in the agreement that could lead to confusion at the time of its enforcement. The possibility of ambiguity is especially likely if the parties have a complex financial situation and need to make an extensive number of provisions in the agreement. One thing that I have frequently run across are agreements drafted by the parties themselves that have ambiguous language as it relates to maintenance. This should be avoided as courts are generally reluctant to enforce provisions that are unclear.
Another mistake that is sometimes made in drafting an agreement is that the couple may have an unrepresented party that wants to enter into the agreement despite the other having legal representation. This could lead to an imbalance of interests in the agreement, which can call into question the enforceability of the agreement. Both parties should be represented by legal counsel.
One common mistake that is widely disregarded by couples is that if there is a significant change in circumstance that affects one or both of the parties, the agreement should be updated. For example, the parties may have drafted an agreement at a time when their income levels were drastically different. Six months later, one of the parties might have a 50% raise. The agreement should be updated to account for the new incomes. Another example could be a change in health circumstances of one of the parties. In that case, the agreement would have to be modified so that the new health circumstances are accounted for. If the agreement is drafted properly, the process of enforcing it in court should be simple, but neither party would feel good about the enforcement process if something could have been done to make it more equitable prior to enforcement.
How to Enforce a Post Marital Agreement
For a post marital agreement to be enforceable there must be an actual separation and the parties must carry out the separation, not simply use it as a tactic to gain leverage in a divorce proceeding. Once an actual separation takes place there are formalities that must be observed to ensure an agreement between the couple is considered valid and enforceable.
First, the parties must voluntarily agree to the terms of the proposal. If the agreement is not made equally between husband and wife, then a court will not recognize the agreement as enforceable. An attorney should review the agreement before either party signs it. A divorce attorney will help ensure the agreement is truly voluntary and provide both parties’ legal representation at the time the agreement is being signed. If the agreement is not reciprocal and one party has a lawyer and the other does not , a court may deem the contract as "buying" the agreement and not voluntary. In that case, since the agreement was uneven, the judge will likely not uphold the agreement and it will become invalid.
Second, there needs to be full financial disclosure between the parties, including disclosing anything that could have significant impact on the agreement. If financial documents are falsified, a judge will probably consider the agreement as fraudulent and therefore unenforceable.
Third, both parties must understand what they are signing. The agreement must be unambiguous, leaving no room for a conflicted interpretation. If a judge considers the agreement unclear then the agreement will be unenforceable.
